A new law will make it easier to introduce and determine the benefits of new tools. Perhaps its most important provisions are its formalization of “prescribable applications,” which include standard software, SaaS, and mobile as well as browser-based apps, and the creation of the Fast-Track Process, an accelerated regulatory path for companies to take their digital health applications to market. With at least 50 apps currently already in the Fast-Track process and hundreds expected over the coming years from manufacturers worldwide, evaluation studies will create a wealth of data on how digital tools for remote patient care work in practice, which other payers and health systems can learn from. They will also be valuable in convincing health care providers — for whom evidence is of paramount importance — of the value of digital tools, both generally and in particular use cases.
In late 2019, Germany’s parliament passed the Digital Healthcare Act (Digitale-Versorgung-Gesetz, or DVG) — an ambitious law designed to catalyze the digital transformation of the German health care system, which has historically been a laggard in that area among peer countries. It is already leading to meaningful changes and will be a boon to the development and evaluation of digital health tools as well as the generation of insights into the value they create.
In the immediate wake of the DVG’s passage, the Covid-19 pandemic has further underscored the need for safe and effective digital tools to support remote patient monitoring and care delivery worldwide. The timely introduction of the DVG means that Germany is poised to set an example for other countries in seeing what works (and what does not) in the adoption and diffusion of digital technologies for improving patient outcomes.
Perhaps the DVG’s most important provisions are its formalization of “prescribable applications” (Digitale Gesundheitsanwendungen, or DiGA), which include standard software, SaaS, and mobile as well as browser-based apps, and the creation of the Fast-Track Process, an accelerated regulatory path for companies to take their digital health applications to market. Following a streamlined review, an app can be added to a central registry of apps that can be prescribed by physicians and psychotherapists and will be reimbursed by all of Germany’s statutory health insurance providers, which cover 90% of the population, or roughly 73 million individuals. The Fast-Track Process is run by the Federal Institute for Drugs and Medical Devices (Bundesinstitut für Arzneimittel und Medizinprodukte, or BfArM), which plays many of the same roles in Germany that the FDA does in the United States); BfArM also maintains the DiGA registry. The first five apps have already been added to the registry and offer support for patients to manage conditions including tinnitus, obesity, agoraphobia, osteoarthritis, and insomnia.
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DVG promises to provide a standard care environment for manufacturers of new digital health tools to evaluate pricing strategies and understand how digital health applications fit into health care practice and patients’ everyday routines. The importance of such a major country mandating that all insurers have to pay for digital health apps is hard to overstate. (In the United States and other countries, it’s still unclear to manufacturers of digital health products who will pay for their offering.)
Entry to this market by digital health firms is, of course, not without legal and regulatory barriers. In order to be listed and remain in the DiGA registry and qualify for reimbursement by health insurers, an app must fulfill various requirements. These include data protection, information security, interoperability, and preliminary data on the benefits that the app provides. Furthermore, the app must already be CE-certified as medical products in one of the EU’s two lowest-risk classes (I or IIa).
If an app fulfills these requirements and provides evidence of its benefit (“positive care effects” associated with use), it can be listed directly. Otherwise, the app must demonstrate evidence of its benefits within 12 months of being added to the registry. This may be the demonstration of either a medical benefit (such as reduced duration of a disease) or patient-related improvements to structure and process of the health care system (such as an increase in patient adherence to a treatment program or improved health literacy). This incremental approach will prove especially valuable for smaller firms and startups, which frequently lack the funding to develop a certified medical product, deal with regulatory proceedings, and fund a large-scale scientific evaluation upfront.
With at least 50 apps currently already in the Fast-Track process and hundreds expected over the coming years from manufacturers worldwide, evaluation studies will create a wealth of data on how digital tools for remote patient care work in practice, which other payers and health systems can learn from. They will also be valuable in convincing health care providers — for whom evidence is of paramount importance — of the value of digital tools, both generally and in particular use cases.
So what should health care decision-makers be looking out for? In addition to the evidence of digital health apps’ benefits, it will be important to see how they stack up in terms of their acceptance by both the medical community and patients as a new element of standard care. If payers in the United States and other countries see that digital tools generate value, they may be more open to paying for them or be better able to articulate under what circumstances such products would be paid for.
The use of real world data for studying digital health apps will likely present both a challenge and an opportunity. (The FDA defines real world data as “data relating to patient health status and/or the delivery of health care routinely collected from a variety of sources” such as electronic health records, medical claims and billing data, data from product and disease registries, and patient-generated data.) Its use will be a challenge because the gold standard for regulatory decisions about new health care products has historically been data from randomized controlled trials. In contrast, in evaluating digital health apps, Germany’s regulatory framework paves the way for the use of real world evidence (the clinical evidence regarding the usage and potential benefits or risks of a medical product derived from analysis of real world data). Regulators such as the FDA have acknowledged the increasingly important role that real world data and evidence are already beginning to play in clinical studies, coverage decisions, and ongoing product monitoring, although best practices for manufacturers are only beginning to be established.
However, the opportunity to learn a great deal and to do so quickly and on an ongoing basis is an exciting feature of using real world evidence that cannot be provided by traditional randomized controlled trials. This represents a major opportunity for all health care decision makers — clinicians, regulators, policy makers, payers, product firms, and patients — to make more informed and more nimble decisions regarding which products to use and when. Moreover, the German system’s performance-based reimbursement provides incentives to assess digital tools on an ongoing basis, which will generate data far beyond the one-time results derived from traditional studies.
In the longer term, digital apps’ prices will be determined by their clinical performance, with real world evidence expected to play a key role in demonstrating effectiveness.
As Germany evaluates new digital tools, it will inevitably spur the generation of a wealth of evidence that will shape the post-Covid-19 digital health ecosystem worldwide. We believe Germany’s approach can be a model for other Western health care systems that are looking to open up their systems for digital innovation.